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CCID Forecasts China Smart Phone Market to Face Diversified Competition

2007-03-22 16:25 843

BEIJING, March 22 /Xinhua-PRNewswire/ -- CCID Consulting Co., Ltd, China's leading research, consulting and IT outsourcing service provider, the first Chinese consulting firm listed in Hong Kong, releases its 2006-2007 Annual Report on China's Smart Phone Market.

CCID Consulting's data show that in 2006, China's smart phone market entered a growth period. For the whole year, sales volume reached 15 million sets, topping 10 million sets for the first time. Sales revenues were close to RMB40 billion, up by more than twice compared with 2005. Smart phones became a new flashing point in the mobile phone market.

For figures on "Changes in Quarterly Sales Volume and Revenues in China's Smart Phone Market, 2005-2006", please visit http://www.ccidconsulting.com/upload/11375.jpg .*

More Low-end products developed as average price dropped

A few years ago, smart phones were still regarded a symbol of high-end consumer products, affordable only by business executives. Today, as the number of equipment makers in the market grows, technology matures and product models enrich, smart phones joined the popular end and became a more affordable product that targets a bigger community.

CCID Consulting's data show that in 2003 when the smart phone was still a novelty to the market, there were only over 30 models in the whole market. The number reached 87 in 2005 and topped 120 in 2006, with products in the RMB 1,000-4,000 price range performed best in the market. Driven by the sales of low- and middle-end smart phones, average product price in the market rapidly dropped in 2006, down to RMB2,450 from RMB3,176 in 2005.

Table 1

Product Sales Structure in China's Smart Phone Market in 2006

-- By Price Band

Price Band 2006Q1 2006Q2 2006Q3

Under RMB2000 32.5% 34.2% 36.2%

RMB 2001-3000 40.0% 43.2% 36.6%

RMB 3001-4000 16.3% 19.0% 24.2%

RMB 4001-5000 8.9% 1.8% 1.2%

RMB 5001-6000 1.3% 0.7% 1.0%

Over RMB 6001 1.0% 1.1% 1.0%

Total 100% 100% 100%

Source: CCID Consulting, Jan. 07

Symbian continued to be the dominant operating system for mobile phones

Symbian OS continued to enjoy the biggest slice of the market. In 2006, Microsoft stepped up its efforts to promote its Windows Mobile OS. As for the secondary development of software platforms, it widely cooperated with terminal makers and many middle-stream and downstream software developers. This enabled the company to expand the use of Windows Mobile. It also attracted more terminal makers to join Microsoft's camp. However, with Nokia phones having the absolute advantages in the market, Microsoft had been unable to greatly increase its market share of its operating system. As Motorola maintained sales of its smart phone, Linux continued to retain its position as having the second largest market share among mobile phone operating systems.

For figures on " Product Sales Structure in China's Smart Phone Market in 2006 -- By OS", please visit http://www.ccidconsulting.com/upload/11376.jpg .*

CCID Consulting forecasts that competition in product segments will become a main feature of the smart phone market

As the whole smart phone market enters a growth period and develops towards a mature stage, many firms have, in addition to mainstream application functions, started to direct their main efforts at market segments where they can bring their advantages into better play.

In the smart phone market, Nokia and Motorola now take up over 90% of the market share, leaving a very limited market to other vendors. If these vendors want to get high returns from this highly profitable market, following the footsteps of big vendors is obviously not a sensible way for them to go. We can see that though smart phones can provide consumers with more personal information processing functions, it still cannot meet some groups' special needs or certain industry demands. These potential demands actually provide a room for the smart phone industry to dedifferentiate in the future.

Compared with ordinary mobile phones, smart phones provide users with more personalized application functions with the help of operating systems. Mobile phone makers are bound to open more market segments based on their own abilities and in relation to consumers' potential demands. Today, market segments such as GPS navigation, push-mail and information security have started to take off. In Beijing, the Chengguantong (All-in-One Municipal Administration) smart phone is being promoted on a large scale. All these actually forebode that future competitions in the smart phone market will become competitions in the market segments.

* Source: CCID Consulting, Jan. 07

About CCID Consulting

CCID Consulting Co., Ltd (also known as CCID Consulting), the first Chinese consulting firm listed in the Growth Enterprise Market of the Stock Exchange (GEM) of Hong Kong (stock code: HK08235), is directly affiliate to China Center for Information Industry Development (hereinafter known as CCID Group). Headquartered in Beijing, CCID Consulting has so far set up branch offices in Shanghai, Guangzhou, Shenzhen, Harbin, with over 300 professional consultants and industry experts. The company's business scope has covered over 200 large and medium-sized cities in China. Apart from home market development, CCID Consulting establishes international cooperation links across the United States, Asia-pacific area and Europe, by setting up agents in the U.S, Japan, South Korea, Australia, Singapore, Italy and Russia, along with the aim to be global.

Based on four major competitiveness of the powerful data channels, industrial resources, intensive knowledge and deep understandings of information technology, CCID Consulting provides customers with consulting, research and IT outsourcing services covering strategy planning, IT application, marketing strategy, human resources and information technology outsourcing. Our customers range from industrial users in IT, telecommunications, energy, finance, automobile, to government departments at all levels and diversified industrial parks. CCID Consulting commits ourselves to become the No.1 brand for strategy consulting, the No.1 consultant for enterprise management and the No.1 expert for market research.

Source: CCID Consulting Co., Ltd
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